Customer service, not products, were source of dissatisfaction for Dell

U.S. consumers lambasted Dell Inc. for poor customer service in a survey conducted last quarter, sending the world's largest PC vendor into a virtual tie with the rest of the PC market behind the industry-leading efforts of Apple Computer Inc.

For the second year in a row, Apple received the best rating from PC buyers in the American Customer Satisfaction Index, said David Van Amburg, general manager of the ACSI. The University of Michigan compiles the ACSI in numerous product categories by randomly calling U.S. residents and surveying their buying habits, he said.

Apple received a score of 81, compared with an industry average score of 74, in results released today. The company's focus on product innovation and customer service has won it a cadre of famously loyal customers, unlike any other PC vendor, Van Amburg said. Apple also received a score of 81 in 2004.

Dell, on the other hand, earned a score of 74, down from a score of 79 the previous year. Survey respondents complained mostly about the quality of Dell's customer service, not its products, Van Amburg said. The ACSI doesn't ask specific questions about the type of problems customers are having with a company, but customers were clearly more frustrated with Dell than they were last year, he said.

A few recurring complaints were the length of time on hold with Dell customer service representatives, as well as the quality of the help customers eventually received, Van Amburg said. Dell has started to expand its lead over Hewlett-Packard Co. in PC shipments, and sometimes when market leaders increase their product shipments, they fail to increase service capabilities at the same rate, he said.

Dell announced plans to open two new customer service centers last week, but CEO Kevin Rollins denied that Dell was having customer service problems.

The ACSI tracks HP's customer satisfaction in two categories, partly because HP's U.S. consumer PC business is divided between two different product lines and partly to provide historical comparisons for the performance of the products before HP acquired Compaq in 2002. HP-branded products received a score of 73, while Compaq-branded products were rated the lowest of any vendor, with a score of 67.

The HP-branded products have now regained the customer satisfaction score they posted before the merger, while the Compaq products have continued to languish well below the rest of the industry, Van Amburg said. HP is looking into its two-brand strategy as it searches for opportunities to cut costs under CEO Mark Hurd, and some analysts believe it might be time to cut the Compaq PCs from its lineup.

Gateway Inc. posted the largest increase in customer satisfaction last year after its acquisition of eMachines, but it slipped a bit from 74 to 72 this year. However, that difference is within the survey's margin of error of three points, Van Amburg said.

Overall customer satisfaction with the PC industry remains well below the scores received by other consumer product industries, such as household appliances and automobiles. Despite all the work the PC industry has done to try to make their products easier to use, customers are still frustrated by PC technology, Van Amburg said.

The index measures the buyer's satisfaction with the last PC they purchased, which allows the ACSI to obtain the freshest experience, Van Amburg said. It surveyed 250 customers per company.